THE pace of growth among small building firms in Northern Ireland quickened in the first three months of this year, despite an overall fall in workloads at the UK level, the Federation of Master Builders (FMB) says.
The north exceeded all other home regions in terms of positive workloads for SME builders, despite economic uncertainty, according to the Federation's latest state of trade survey.
Northern Ireland’s net balance grew by nine percentage points to plus-41. There were no negative weighted responses in the latest survey findings, which is down from the 12 per cent registered in the previous quarter.
Approximately 41 per cent of weighted responses were positive, down from 44 per cent, while around 59 per cent of weighted responses were neutral, up from 44 per cent.
The FMB's regional director Gavin McGuire said: “Northern Ireland has remained resilient while the UK as a whole has stalled, with overall SME workloads declining for the first time in six years.
“But we can’t be complacent given the real concerns over public sector construction projects drying up. And this, coupled with the recent collapse of the social housing maintenance framework, has led to a sudden culture of low price bidding by contractors desperate to win work.
“In some cases, contractors are even bidding below the level at which they can make a profit on a project. This situation is unsustainable and we need procurers to work with industry to ensure this is no longer the case as if it continues, it could put the existence of some contractors at risk, which is bad news for the construction sector and bad news for Northern Ireland’s economy.”
He added: “Another major concern among builders at the moment is the rapid rise in materials prices. Margins in this sector are already paper thin so extra costs could end up stifling small construction companies, or lead to higher prices for home-owners. Securing a smooth and orderly Brexit will be key to ensuring prices don’t rise even further.”
Other key findings in the latest survey include:
• Skills shortages eased slightly among some occupations. Bricklayers were once again the trade in most short supply with 64 per cent of firms having difficulties hiring them, followed by carpenters and joiners;
• A record 88 per cent of builders anticipate that material prices will rise further in the next six months;
• Almost three-quarters (71 per cent) of construction SMEs expect wages and salaries to increase over the next six months, up from 66 per cent in the previous quarter.
